Calendar Spread Advanced

Options Advanced NIFTY Options BANKNIFTY Options Stock Options

Neutral to slightly directional - expecting price to stay near strike

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Quick Reference

Strategy Type	Volatility / Time Decay Arbitrage
Market Outlook	Neutral to slightly directional - expecting price to stay near strike
Risk Profile	Limited to net debit paid
Reward Profile	Limited but can be substantial at optimal expiry
Time Horizon	Front month expiry to back month expiry (1-8 weeks typically)
Capital Requirement	Moderate (₹15,000 - ₹40,000 per lot for NIFTY)
Margin Type	Debit spread - no additional margin beyond premium paid
Best Used When	Front month IV elevated relative to back month, expecting price stability near strike, anticipating IV expansion in back month

Front month IV elevated relative to back month, expecting price stability near strike, anticipating IV expansion in back month

NIFTY	25 units per lot
BANKNIFTY	15 units per lot
Stock Options	Varies by stock (check NSE contract specifications)

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